Red Alert

09.16.12

Is China Losing It?

The government was mum when China's heir apparent Xi Jinping went missing, and political jitters persist now that he's reappeared. How many scandals can the leadership take?

This year has been Beijing’s annus horribilis. The Chinese regime has been pummeled by a steady stream of political controversies, purges and rumor mongering, made all the more nerve-wracking because a once-in-a-decade succession is due to kick off this autumn, though the date has yet to be revealed. When heir apparent Xi Jinping went missing from public view for two weeks this month, government officials had provided some mimimalist explanations about a minor health problem, but in the absence of transparency the rumor mill ran wild. Even after Xi reappeared on Saturday, some jittery cadres leaked speculation that his disappearance augured possible glitches in the coming leadership transition, expected to begin in October.

What does it all mean? For decades, China’s post-Mao leaders guided their nation’s modernization based on the belief that economic reform and liberalization were possible, even desirable, without a similar transformation in Beijing’s ossified political system. Thirty years ago the late Deng Xiaoping dazzled the world by adopting capitalistic tools and practices to remake China’s moribund centrally planned economy. “To get rich is glorious,” he was quoted as saying. And many Chinese did get rich.

What’s more, their country—now the world second biggest economy—became increasingly interconnected with the world. Yet much of that phenomenal growth hinged on Deng’s Grand Bargain with the people: the communist party promised to raise their living standards and modernize the economy, in exchange for political obedience from the citizenry in the face of continuing autocratic, secretive, one-party rule.

Today, scandals that have tainted China’s leadership suggest that Deng’s Grand Bargain is unraveling. The same old political habits—opacity, corruption, cover-ups, nepotism, disregard for laws, and a sense of impunity among the ruling elite—now clash with the rising expectations of a population that’s not just wealthier but also more politically demanding, Internet-savvy, and conscious of its rights than ever before.

Take the mindboggling lack of information about Xi’s disappearance from public view. Since the health of senior leaders is considered an issue of national security, those who knew Xi’s status weren’t really talking, partly for fear of revealing “state secrets.” a serious crime. And those who were talking didn’t really know—leading to a proliferation of ludicrous speculation. “This sort of thing was common in the 50s, 60s, and 70s, but it’s astounding now that China’s so interdependent with the outside world,” says China analyst David Zweig at the Hong Kong Institute for Science and Technology. “Just imagine if the Chinese currency, the renminbi, were convertible—there would have been a run on the renminbi. If you want to be interdependent with the world, you can’t be so opaque.”

Secrecy and covering up are default positions in China’s political environment.

Yet secrecy and covering up are default positions in China’s political environment. The latest shoe to drop in Beijing’s web of interlocking scandals is Friday’s news that former Chongqing top cop Wang Lijun will go on trial Tuesday, Sept. 18 on charges of defection, bribe-taking, “bending the law for selfish ends,” and abuse of power. It was Wang’s startling flight in February to the American consulate in Chengdu—where he revealed a jaw-dropping tale of blood and intrigue involving his onetime boss and then-Politburo member Bo Xilai and Bo’s wife Gu Kailai—that led to Bo’s purge, Gu’s trial on murder charges, and China’s messiest succession in decades. (Last month Gu was given a suspended death sentence for killing British businessman Neil Heywood).

What infuriates ordinary Chinese and amazes foreign Sinologists is the aura of total impunity which cloaked Gu as she poisoned Heywood, and then tried to cover up the crime. If Wang hadn't divulged secrets to U.S. diplomats, many Chinese believe Gu literally could have gotten away with murder. And in a more recent controversy, senior official Ling Jihua was demoted after reportedly trying to cover up the fact that his son, and two scantily clad young women, had been in a fiery high-speed Ferrari crash in March. At the root of all these dramas is the fact that many senior officials' families live way beyond their apparent means -- Bo's annual salary was a measly $20,000 yet "housewife" Gu purchased British real estate worth millions -- and feel no need to account for the disparity. "The leadership's credibility gap is growing because of these scandals," says Hu Xingdou, a political economist with Beiing's Institute for Technology.

Many Chinese see the uncertainties and opacity of the current leadership succession as omens that the regime’s old strategy of tinkering with the economy while keeping a tight lid on politics is no longer sustainable. Zhang Lifan, a former researcher with the Chinese Academy of Social Sciences, says, “The scandals are very serious, and require some leaders to push for greater and more genuine transparency. It’s a life-or-death matter for the communist party.” The big question is whether Deng’s old bargain between the government and the governed is about to expire—and if so, whether China’s new leadership team can come up with a better deal.